Cliffs to Acquire INR Energy

Cliffs Natural Resources has entered into a definitive agreement to acquire all of the coal operations of privately owned INR Energy for $757 million. INR produces high-volatile metallurgical and thermal coal. The transaction is expected to close by the beginning of September.

“When combined with our current coal production in West Virginia, Alabama and Queensland, Australia, Cliffs estimates 2011 global equity production capacity of approximately 9 million tons at a split of approximately 7 million tons met and 2 million tons thermal,” said Joseph A.

Carrabba, chairman, president and CEO, Cliffs. “We currently anticipate expanding INR’s production of high-vol met coal to 2.4 million tons by 2012, increasing Cliffs total future global equity coal production capacity to nearly 11 million tons split at 8 million tons met and 3 million tons thermal.” The acquisition includes a metallurgical and thermal coal mining complex with a coal preparation and processing facility located in southern West Virginia. This includes a reserve base with an estimated 68 million tons of met coal and 51 million tons of thermal coal. This reserve base would increase Cliffs’ total global reserve base to more than 175 million tons of met coal and more than 57 million tons of thermal coal. Under its long-term operating plans, Cliffs would not anticipate a need to bring additional newly permitted mines online prior to 2017.

INR’s operations include two room-andpillar mines producing met coal, the Powellton and Chilton-Dingess mines and one surface mine, the Toney Fork No. 2 mine. In addition to these mines, INR is currently working on several other development projects within this same complex which Cliffs will actively pursue.